Search found 1808 matches
- Wed Jan 25, 2023 11:14 pm
- Forum: Personal Consumer Issues
- Topic: Summer/Fall home on Boston commuter line
- Replies: 37
- Views: 4257
Re: Summer/Fall home on Boston commuter line
Hingham has a MBTA-subcontracted ferry into Rowe’s wharf or Long wharf. Once you hit Rowe’s wharf, you next to south station to the red line and the silver line into the airport or just stick around seaport/little Italy. The town is small, has condos (better they take care of it if you’re not there in the winter), and coastal with lots of kayaking/boats options. You could even get your own dock.
- Sat Jan 21, 2023 4:42 pm
- Forum: Personal Finance (Not Investing)
- Topic: Do I take the new job?
- Replies: 22
- Views: 1960
Re: Do I take the new job?
What’s the mat leave? Often they have a minimum tenure, like 1 year, to qualify.am about to have our third kid at the end of the year.
- Fri Jan 20, 2023 10:32 am
- Forum: Personal Investments
- Topic: Which spouse to reduce retirement contributions?
- Replies: 11
- Views: 884
Re: Which spouse to reduce retirement contributions?
$90,000 that I am putting in if I max which seems a little bit overkill. Depends on your goals. Two pensions plus saving 22.5% (3 maxed accounts) is a heck a lot better than the average person and you’ll be more than comfortable in retirement (which could be relatively young). It’s not aggressive FIRE numbers, but that doesn’t sound like the goal. Sounds like you want a nice house and are willing to work for more years to buy it and not to “cut back” life style too much while buying daycare services (which is how you can can have two careers in the first place). Okay, that’s a fine way to live life. If it makes you feel better, we also don’t max all our retirement accounts because it’s a comically large amount of space that exceeds our nee...
- Fri Jan 20, 2023 10:18 am
- Forum: Personal Investments
- Topic: Which spouse to reduce retirement contributions?
- Replies: 11
- Views: 884
Re: Which spouse to reduce retirement contributions?
I’ll assume these are all good plans with cheap , well diversified funds which is common for government employees.
I’d keep both 457s as these do not have an age plenty on withdrawal after separation and you’re young enough that could have use. This is especially appealing if your pensions start early (55?) to allow many years for decompression of the funds before RMDs.
Roth 401(k) vs traditional: you’re deep into the 24% bracket + state. There is a good chance at some point only one of you will be working (kids, age gap) - and that will create an opportunity to rollover to an IRA and convert to Roth at a lower bracket.
To me, it’s a coin flip between 401(k) vs 403(b) but I would definitely dump the Roth.
I’d keep both 457s as these do not have an age plenty on withdrawal after separation and you’re young enough that could have use. This is especially appealing if your pensions start early (55?) to allow many years for decompression of the funds before RMDs.
Roth 401(k) vs traditional: you’re deep into the 24% bracket + state. There is a good chance at some point only one of you will be working (kids, age gap) - and that will create an opportunity to rollover to an IRA and convert to Roth at a lower bracket.
To me, it’s a coin flip between 401(k) vs 403(b) but I would definitely dump the Roth.
- Wed Jan 18, 2023 11:35 pm
- Forum: Personal Finance (Not Investing)
- Topic: New Mortgage: Why would anyone choose ARM when ARM is [more] expensive than 15 year fixed ?
- Replies: 41
- Views: 3826
Re: New Mortgage: Why would anyone choose ARM when ARM is expensive than 15 year fixed ?
With this narrow of a spread, I’d go for the 30-year fixed. You can pay it off in 15 in you like, especially of the mortgage interest is not deductible.
- Fri Jan 13, 2023 10:43 am
- Forum: Personal Investments
- Topic: Switching FZROX (Fidelity Zero Total Market) to FSKAX
- Replies: 4
- Views: 1820
Re: Switching FZROX (Fidelity Zero Total Market) to FSKAX
Good idea. +1 vote for TLH and giving yourself the option of leaving Fidelity at the same time.
- Wed Jan 11, 2023 9:03 am
- Forum: Personal Finance (Not Investing)
- Topic: RSU Refreshers - Units or Total Value?
- Replies: 14
- Views: 1194
Re: RSU Refreshers - Units or Total Value?
In my experience in pharma (3 SP500 companies), the new grant are a target value. In down years, this is usually is more share number. More share numbers can mean more dividend equivalents for some classes of LTIs (TRSU, PSP, etc; but dividends are not a feature of RSUs, ESPP, or Options) and a form of delayed compensation you for sticking with the company through lean times when bonuses are low. Your exact mix of LTI variants (options, RSU, PSP, etc) depends on your level and the company’s performance. My vague sense is they try to smooth the value overtime - but that’s conjecture.
The term “refresher” is something I’ve only heard about in tech.
The term “refresher” is something I’ve only heard about in tech.
- Tue Jan 10, 2023 12:42 pm
- Forum: Personal Finance (Not Investing)
- Topic: What to do when your 401K does not have true-up
- Replies: 29
- Views: 2824
Re: What to do when your 401K does not have true-up
Like what others have said, try to divide evenly.
This can be tricky as whole % rather than specific $ amounts can make a mess of maximizing the 401(k) deferral and the match. If it’s impossible, favor the match over then hitting the deferral limit. Sometimes, you can just do the minimum match % for most of the year and increase the last few checks to maximize both the match and the deferral limit. An excel sheet can help with the timing.
You may also have a deferred comp plan that allows you to continue to contribute and get the match. YMMV per employer and your position/level.
This can be tricky as whole % rather than specific $ amounts can make a mess of maximizing the 401(k) deferral and the match. If it’s impossible, favor the match over then hitting the deferral limit. Sometimes, you can just do the minimum match % for most of the year and increase the last few checks to maximize both the match and the deferral limit. An excel sheet can help with the timing.
You may also have a deferred comp plan that allows you to continue to contribute and get the match. YMMV per employer and your position/level.
- Thu Jan 05, 2023 9:09 am
- Forum: Personal Investments
- Topic: Do you put Company Stock in AA?
- Replies: 8
- Views: 593
Re: Do you put Company Stock in AA?
Company stock is income once it vests.
Ignore them until they vest because they are worthless up until that point. When they invest, sell them immediately.
Ignore them until they vest because they are worthless up until that point. When they invest, sell them immediately.
- Thu Jan 05, 2023 12:41 am
- Forum: Personal Investments
- Topic: Taxable Brokerage account - Vti or Voo?
- Replies: 25
- Views: 5869
Re: Taxable Brokerage account - Vti or Voo?
Both. Switch between the two when tax lost harvesting.
- Wed Jan 04, 2023 2:31 pm
- Forum: Personal Finance (Not Investing)
- Topic: Leaving the Bay Area: should I rent out my low mortgage rate house?
- Replies: 61
- Views: 5409
Re: Leaving the Bay Area: should I rent out my low mortgage rate house?
Sell. Remote LL in CA is no fun. This is unlikely to be a good investment, but more importantly there are considerable risks scenarios (regulatory risks, recent COVID renter protections in CA). Secondary, you may still eeek out a profit despite the recent run up in mortgage rates. The capital gain exclusions will be eroded by renting the property. Finally, leaving the equity in the house means you have to take on a larger loan with much higher interest. To make matters worse, the rental interest is deductible on the schedule E making the effective rate very low while the primary home interest is after tax (or very close given your itemization will be low in WA). So your rental profits (if any) will need to make up the spread to make any sen...
- Sat Dec 24, 2022 5:32 pm
- Forum: Investing - Theory, News & General
- Topic: Ben Felix: 2.7% Retirement Rule.
- Replies: 847
- Views: 76695
Re: Ben Felix: 2.7% Retirement Rule.
...Longevity is trending up... Everybody wishes it were so, and it used to be true, but it shouldn't just keep being repeated without checking. It has been falling in the United States, for at least two years in a row. Harvard Medical School: Why life expectancy in the US is falling It was never as much as many people thought. "Life expectancy" without further qualifications means life expectancy at birth. That number is dominated by infant mortality. Any mental image of everybody dying at age forty is wrong, even three thousand years ago it was written that "The days of our years are three score and ten." It's just that so many people died within the first year. Life expectancy at age 65 has been "trending up,&quo...
- Sat Dec 24, 2022 10:16 am
- Forum: Investing - Theory, News & General
- Topic: Ben Felix: 2.7% Retirement Rule.
- Replies: 847
- Views: 76695
Re: Ben Felix: 2.7% Retirement Rule.
He makes a convincing argument a 2-3% rate is probably more realistic, and that a 4% rate is probably unrealistic. What's the argument? Did you watch it? Basically, the exceptional performance of markets over the last decade or so is historically anomalous, so consistent 4% returns seems unlikely for a well diversified portfolio with a retiree risk appropriate stock/bond allocation. I haven't had a chance to watch it (I dislike videos in general compared to reading)... but I hope he said more than that. The 4% rule has nothing to do with the exceptional performance of markets over the last decade. We could have pulled 8%-10% a year probably over the last decade. The 4% "rule" is just an observation, that in the U.S., over the pas...
- Fri Dec 23, 2022 11:36 pm
- Forum: Investing - Theory, News & General
- Topic: Ben Felix: 2.7% Retirement Rule.
- Replies: 847
- Views: 76695
Re: Ben Felix: 2.7% Retirement Rule.
SWR studies were based on a 30 year withdrawal period. The Anarkulova study didn't define the SW by a fixed period. The study starts with a couple at age 65 and randomly assigns/"draws" modern-to-future-looking mortality and then randomly assigns returns on the stated AA using historical data across multiple markets. The average joint survival is 89.7 while those in the top 95% will live to 100.5 years. This modeling includes a mortality simulator with the 4% WR giving a17.4% chance to deplete wealth ($0) prior to death and 16% chance that you live another 5 years beyond the depletion. Here's the morality method from the study: 2.3 Mortality. Our modeling approach examines the joint distribution of longevity and portfolio outcome...
- Thu Dec 22, 2022 9:56 am
- Forum: Personal Consumer Issues
- Topic: Router Recommendation for ~ 2,700 sqft and 3 floors
- Replies: 41
- Views: 3265
Re: Router Recommendation for ~ 2,700 sqft and 3 floors
I’m no expert, but another positive experience with the Orbi mesh. It covers the entire 14k sq ft property from front to back with 3 units. The reception is very uniform with a 4-5 bars out of 5 and doesn’t drop when moving from one area to another.
- Sun Dec 18, 2022 9:49 am
- Forum: Personal Finance (Not Investing)
- Topic: Rewards credit card for unusual category
- Replies: 17
- Views: 1689
Re: Rewards credit card for unusual category
Amen. I’m currently working on that Chase Business Ink card $900 sign on bonus plus 1.5% rewards plus 0% APR for 12-month (which I’m not paying off until the teaser rate expires and instead building a payoff fund with T-notes and MM for a few extra %).whodidntante wrote: ↑Sat Dec 17, 2022 11:24 pm A sign up bonus will pay way more than 3%, even if the rewards rate is 1%.
That all significantly beats the well justified 3% fee. I hope we see more local businesses passing pass through cost.
- Thu Dec 08, 2022 9:18 am
- Forum: Personal Investments
- Topic: Nonqualified deferred compensation plan
- Replies: 18
- Views: 1668
Re: Nonqualified deferred compensation plan
OP, how large and stable is your employer? That would be the first decision point for me. FWIW, I participated on my employers NQDC plan the last half dozen years I was working. Was in the top marginal Federal tax bracket at that time. Unfortunately, my employer was acquired in 2016 and the plan required a 100% payout (regardless of the payment election made prior) upon change in control. So, I deferred income from years when I was in the top Federal marginal bracket into a year when I was also in the top Federal marginal tax bracket. Spouse had a similar situation. That was an unpleasant tax year. The other concern with OP's timing of the distributions (65-70) is IRMAA. I had a tax attorney review my DCP and he commuted that “change contr...
- Thu Dec 01, 2022 10:58 am
- Forum: Investing - Theory, News & General
- Topic: 2nd Career at age 60: should i max out my 401K and Catch-Up?
- Replies: 12
- Views: 1481
Re: 2nd Career at age 60: should i max out my 401K and Catch-Up?
Your pension is covering all your expenses and you have a two house income on top of a $1.2m (pre-crash) retirement accounts and SS coming in at age 70. I would first ask what do you want to do with your excess assets?
Your income is clearly more than you need and maybe even more than your ‘wants.’ Saving and investing is just a goal without meaning.
Your income is clearly more than you need and maybe even more than your ‘wants.’ Saving and investing is just a goal without meaning.
- Thu Nov 24, 2022 10:46 am
- Forum: Personal Investments
- Topic: Non Qualified Excess Savings Plan vs Mega Backdoor - need advice
- Replies: 5
- Views: 597
Re: Non Qualified Excess Savings Plan vs Mega Backdoor - need advice
The variance between DCPs is much higher than 401(k) and you find all sorts of quirks. The age portion of the “leave the company or turn 55, whichever is later” clause is something I’ve ever seen or even hear of. All plans I’ve seen are simply starts distributions the year after separation either as a lump or annual installments up to 10 years. The age thing is very odd given DCP are part of a retention tool (golden handcuffs) and this clause gives leadership an “out.” Usually, these terms are not negotiable…unless you’re really high in the organization… Someone on this board recommended having a tax attorney review these documents before putting large sums in these plans because they’re so variable. I did and consider the advice worth the ...
- Wed Nov 23, 2022 7:03 pm
- Forum: Personal Investments
- Topic: Non Qualified Excess Savings Plan vs Mega Backdoor - need advice
- Replies: 5
- Views: 597
Re: Non Qualified Excess Savings Plan vs Mega Backdoor - need advice
At 37, megaback door Roth first then DCP. IMO the largest likely “problem” with is the distribution upon separation without an option rollover or when there is an event such as a merger/acquisition if the plan has a change control clause (I’m not a lawyer, but I did pay for a tax attorney review and this was a major consideration in his review). When distributions start, you will either take a huge tax hit, find an employer also offering a DCP that will (indirectly) offset distributions, or low-income (e.g. unemployment). At 37, the chance you’ll be forced into a distribution over the course of your career is high. If you plan FIRE <10 years and feel stable, maybe you consider a DCP over the MBR. ————— I use mine as self-funded unemployment...
- Mon Nov 21, 2022 5:59 pm
- Forum: Personal Investments
- Topic: Deferred Comp Plan Options
- Replies: 5
- Views: 732
Re: Deferred Comp Plan Options
What is the goal of this DCP fund?
What are the payment options upon separation?
I usually don’t consider DCPs a retirement account unless you’re <10 years away of retirement. You can’t roll these over to another plan [1]. I think you need to define objectives before you decide on an asset allocation.
[1] directly that is. You could (and I do) contribute to another DCP to offset distributions from a prior employer’s plan. But this limits my employment options.
What are the payment options upon separation?
I usually don’t consider DCPs a retirement account unless you’re <10 years away of retirement. You can’t roll these over to another plan [1]. I think you need to define objectives before you decide on an asset allocation.
[1] directly that is. You could (and I do) contribute to another DCP to offset distributions from a prior employer’s plan. But this limits my employment options.
- Thu Nov 17, 2022 9:04 am
- Forum: Personal Consumer Issues
- Topic: Books about navigating Corp America?
- Replies: 15
- Views: 1165
Re: Books about navigating Corp America?
“The first 90 days” is a classic worth (re)reading before each new job and promotion. It lays out steps and milestones to make a successful start.
- Sat Nov 12, 2022 10:05 am
- Forum: Personal Consumer Issues
- Topic: 6 Day Southern California Family Trip - Completed!
- Replies: 69
- Views: 8039
Re: 6 Day Southern California Family Trip - Updated
On Day 1 or 5 when you’re near LAX, Old Town Music Theater plays classic movies and occasionally has their Mighty Wurlitzer organ. El Segundo around the feather has a nice walkable downtown which is good for lunch or dinner.
- Sat Nov 12, 2022 9:58 am
- Forum: Personal Consumer Issues
- Topic: Buying a home - Asking the seller to buy down my interest rate
- Replies: 40
- Views: 5525
Re: Buying a home - Asking the seller to buy down my interest rate
I agree with everyone else: just lower the price or ask for credits. It’s the same thing to the seller and the will look at every request in total for your total offer. It’s simpler to ask the seller for credits and pay points yourself.
Save your high dollar requests for after the inspection.
Save your high dollar requests for after the inspection.
- Sun Nov 06, 2022 10:08 am
- Forum: Personal Finance (Not Investing)
- Topic: Job-loss / mortgage insurance
- Replies: 54
- Views: 4314
Re: Job-loss / mortgage insurance
I’d like to revisit this statement… if I were to get laid-off so I don't end up selling stocks when the market is down to cover $3k/month. How much do you have in taxable accounts? DCA’ing out of the bottom of the market (which is in no way a given we’re at bottom) because you’re experiencing an emergency is not the end of the world. You make it sound like it’s not even an option. Hypothetically, let’s say your severance/unemployment benefits are $20k and you got $50k in taxable investments to cover $3k a month. You got 2 years of cash flow negative part of your budget, wife’s income is increasing, you’re TLH the losers to offset your wife’s income (maybe phasing into some tax deductions/credits), you’re job searching, savings a bit of mone...
- Sat Nov 05, 2022 11:18 am
- Forum: Personal Consumer Issues
- Topic: Negotiating Prices - what’s your best technique?
- Replies: 34
- Views: 4818
Re: Negotiating Prices - what’s your best technique?
Call 5 vendors/contractors.
~3 will get their bid out.
Only get line item quotes and negotiate each line (friendly, but persistent). Find the pieces you can do yourself including buying materials.
Ask for a “cash” (check) discount instead of using a credit card. Failing that, open a sign on cash bonus credit card and use the large purchase to meet the minimum spend (one time I finished two cards using different ones for the deposit and the other for the final bill).
One time I asked for a discount for signing before they left the property for scoping the jobs. That was a special case were I knew I was going with vendor. It was only 2%, but they were the only ones that could meet the timeline (and had a decent price).
~3 will get their bid out.
Only get line item quotes and negotiate each line (friendly, but persistent). Find the pieces you can do yourself including buying materials.
Ask for a “cash” (check) discount instead of using a credit card. Failing that, open a sign on cash bonus credit card and use the large purchase to meet the minimum spend (one time I finished two cards using different ones for the deposit and the other for the final bill).
One time I asked for a discount for signing before they left the property for scoping the jobs. That was a special case were I knew I was going with vendor. It was only 2%, but they were the only ones that could meet the timeline (and had a decent price).
- Fri Nov 04, 2022 8:14 pm
- Forum: Personal Investments
- Topic: Saving for vehicle upgrade
- Replies: 12
- Views: 1663
Re: Saving for vehicle upgrade
iBonds
iBonds will give both yield, flexibility (after 1 year maturity), and let you control when you realize the gains.
iBonds will give both yield, flexibility (after 1 year maturity), and let you control when you realize the gains.
- Tue Nov 01, 2022 8:51 am
- Forum: Personal Finance (Not Investing)
- Topic: ARM Mortgage pay off strategy
- Replies: 10
- Views: 1334
Re: ARM Mortgage pay off strategy
OP, what index does the ARM track and what’s the margin?
LIBOR +2% to +2.5% were common at that time.
If the rates go up, do you face any liquidity risk/risk missing your payments? If not, I probably would not pay additional principal at this point. I would let the ARM adjust and make decisions year-by-year based on the interest spread.
If you really want to pay it down…no way would I skip the 401(k) or Roth. You could make an argument for redirecting taxables contributions (and maybe TLH taxables bonds) toward the mortgage. But I would not liquidate the taxables as that’s a huge liquidity loss and IMO significantly increases risk.
LIBOR +2% to +2.5% were common at that time.
If the rates go up, do you face any liquidity risk/risk missing your payments? If not, I probably would not pay additional principal at this point. I would let the ARM adjust and make decisions year-by-year based on the interest spread.
If you really want to pay it down…no way would I skip the 401(k) or Roth. You could make an argument for redirecting taxables contributions (and maybe TLH taxables bonds) toward the mortgage. But I would not liquidate the taxables as that’s a huge liquidity loss and IMO significantly increases risk.
- Sat Oct 29, 2022 9:28 am
- Forum: Investing - Theory, News & General
- Topic: Amazon and Meta Big Earnings Miss!
- Replies: 46
- Views: 6902
Re: Amazon and Meta Big Earnings Miss!
I am worried about the tech stocks, not because I’m employed in that sector, but due to the cap weighted exposure is increasingly concentrated. As of this month, the tech sector is 26.4% of the SP500 with the top 10 holdings of Apple (AAPL): 6.99% Microsoft (MSFT): 5.63% Amazon (AMZN): 3.32% Tesla (TSLA): 1.96% Alphabet Class A (GOOGL): 1.93% Alphabet Class C (GOOG): 1.71% Berkshire Hathaway Class B (BRK.B): 1.59% UnitedHealth Group (UNH): 1.54% Johnson & Johnson (JNJ): 1.39% Exxon Mobil (XOM): 1.36% Seeing Amazon and Meta stumble this quarter, makes me ask the question is large cap weight indexes enough diversification? 7% in Apple looks like a individual stock pickers portfolio and inching towards the opposite of a Boglehead. Meanwhil...
- Sat Oct 29, 2022 8:41 am
- Forum: Personal Finance (Not Investing)
- Topic: An old friend asked for financial advice. I don't know what to say.
- Replies: 57
- Views: 9960
Re: An old friend asked for financial advice. I don't know what to say.
There are social workers who specialize in adult services/seniors. There know all the local assistance services and programs inside and out, including SNAP, Medicare, transportation (though your friend has a car), etc. It might be worth an appointment with your local social worker.
- Thu Oct 27, 2022 9:09 am
- Forum: Personal Consumer Issues
- Topic: Thule laptop backpack?
- Replies: 19
- Views: 1631
Re: Thule laptop backpack?
I would test in person if possible. Backpacks, like shoes, can fit people differently.
TIMBUK2 And Swissgear are my go to for men’s professional looking laptop backpacks with build quality. I have no comment/experience with Thule. Swissgear are very tough and well cushioned straps but more bulky and not as professional looking (not flashy, but not exactly a clean business look). TIMBUK2 are well made, sleeker professional look, and have some low profile/travel packs that sound like a good match (TIMBUK2 Foundry Pack?).
For women, I would add Tumi to the list.
TIMBUK2 And Swissgear are my go to for men’s professional looking laptop backpacks with build quality. I have no comment/experience with Thule. Swissgear are very tough and well cushioned straps but more bulky and not as professional looking (not flashy, but not exactly a clean business look). TIMBUK2 are well made, sleeker professional look, and have some low profile/travel packs that sound like a good match (TIMBUK2 Foundry Pack?).
For women, I would add Tumi to the list.
- Sat Oct 15, 2022 9:18 am
- Forum: Personal Finance (Not Investing)
- Topic: Mortgage as a fraction of total housing costs
- Replies: 7
- Views: 630
Re: Mortgage as a fraction of total housing costs
About 58% here. The mortgage should decrease as a percent naturally as other costs like insurance, taxes, utilities, etc go up and your PI payments stay nominally flat.
It might be especially acute now with energy prices/heat waves and, in your case, property taxes.
Semi-related, this discussion is the reason I don’t get that excited about paying off the mortgage. The PI is just one of many bills.
It might be especially acute now with energy prices/heat waves and, in your case, property taxes.
Semi-related, this discussion is the reason I don’t get that excited about paying off the mortgage. The PI is just one of many bills.
- Fri Oct 14, 2022 3:57 pm
- Forum: Personal Finance (Not Investing)
- Topic: Is saving 34% of income towards retirement reasonable?
- Replies: 138
- Views: 17583
Re: Is saving 34% of income towards retirement reasonable?
You need to define your goals: what age do you want to retire? Then back calculate the saving requirement rate.
It is totally possible to save too much and pay an opportunity cost. I will disagree with the trend on this thread: ‘more is not better’ and there is significant diminishing returns for higher and higher savings.
It is totally possible to save too much and pay an opportunity cost. I will disagree with the trend on this thread: ‘more is not better’ and there is significant diminishing returns for higher and higher savings.
- Fri Oct 14, 2022 3:25 pm
- Forum: Investing - Theory, News & General
- Topic: Buying through the great depression - money guys line
- Replies: 45
- Views: 5919
Re: Buying through the great depression - money guys line
This is a great time to be in the long-term accumulation phase: “full” employment (so far), cheap mortgages being offset by inflation and interest arbitrage, and stocks fundamentals improving (so far). I’m eagerly and happily buying with paycheck."A twenty-five year-old who is actively saving for retirement should get down on his knees and pray for a decades-long, brutal bear market so that he can accumulate stocks cheaply." Dr. Bernstein
- Thu Oct 06, 2022 8:57 am
- Forum: Personal Investments
- Topic: Move an IRA into a 401K ?
- Replies: 19
- Views: 2066
Re: Move an IRA into a 401K ?
The primary reason prefer a 401(k) to enable back door Roth IRA conversions without running into the pro-rats rule. A secondary reason is state-specific legal protections.
If neither of those apply, I don’t think it’s worth the hassle.
If neither of those apply, I don’t think it’s worth the hassle.
- Mon Oct 03, 2022 11:00 pm
- Forum: Personal Finance (Not Investing)
- Topic: Mortgage: 30 year fix vs 10/1 ARM
- Replies: 7
- Views: 894
Re: Mortgage: 30 year fix vs 10/1 ARM
What’s the index and margin on the ARMs?
- Sat Oct 01, 2022 12:13 pm
- Forum: Personal Investments
- Topic: How should I approach extra payments on an ARM?
- Replies: 13
- Views: 1218
Re: How should I approach extra payments on an ARM?
Thank you for the detailed and very helpful response. Am I understanding correctly that you would recommend no additional payments at all, and instead just invest excess cash into taxable assets (given all tax-advantaged space is maxed out)? Meanwhile, I can be on the lookout for refinance opportunities and take advantage if one arises. If one does not arise, I'd be prepared to make additional payments starting in year 8 with those additional payments coming from increased income at the time? Basically, I think of this option as saying "don't accelerate payments on a 3.25% loan, but if you are confronted with a 5.25%+ loan 8 years from now, feel free to accelerate payments then." Does this accurately characterize this approach? Y...
- Sat Oct 01, 2022 9:06 am
- Forum: Personal Investments
- Topic: How should I approach extra payments on an ARM?
- Replies: 13
- Views: 1218
Re: How should I approach (pre)paying an ARM?
In your shoes, I would pay on schedule with no additional payments and stay flexible according to current rates as you’ve described. The reasons being the (#1) the interest arbitrage opportunity now are available and seemingly on an upward trend; this really the ideal conditions for an ARM: low ARM rate followed by an immediate spike and then arbitrage the interest :beer (#2) it is expensive to get equity out of a house, so paying down a mortgage increases liquidity risk (assuming you save/invest the difference; (#3) your high marginal rate means realizing gains to pay the mortgage is expensive; (#4) your future income should increase with 2029/2030 income 14-17% higher on the conservative end (with 2%/yr raises, assumes no promotion); (#5)...
- Fri Sep 30, 2022 6:27 pm
- Forum: Personal Finance (Not Investing)
- Topic: Will need to move soon - is now the time for an ARM?
- Replies: 35
- Views: 3009
Re: Will need to move soon - is now the time for an ARM?
OP, I’d wage an ARM will be a no brainer assuming two things: first, your 10 year projection holds. Second, the ARM-vs-fixed spread remains attractive.
I suggest you repost when you have an offer accepted and have competitive mortgage quotes. This is a year out and a lot of factors will change including the RE market, mortgage rates, and personal. Stay flexible and not dogmatic.
I suggest you repost when you have an offer accepted and have competitive mortgage quotes. This is a year out and a lot of factors will change including the RE market, mortgage rates, and personal. Stay flexible and not dogmatic.
- Thu Sep 29, 2022 7:15 am
- Forum: Personal Finance (Not Investing)
- Topic: Will need to move soon - is now the time for an ARM?
- Replies: 35
- Views: 3009
Re: Will need to move soon - is now the time for an ARM?
You will need to apply for the mortgage and come back with real quotes to get decent advice. The ARM vs fixed spread varies overtime.
Some important consideration to think about:
-How long will to stay in the new house?
The average buyer stays in their second house about 11 years. Shorter durations favor ARMs while longer durations are a more complex discussion.
-Will you be paying off the mortgage early?
-What is your liquidity risk (ability to make payments) when the ARM adjusts?
-Physiologically, does a potential change in interest rate bother you significantly?
Some important consideration to think about:
-How long will to stay in the new house?
The average buyer stays in their second house about 11 years. Shorter durations favor ARMs while longer durations are a more complex discussion.
-Will you be paying off the mortgage early?
-What is your liquidity risk (ability to make payments) when the ARM adjusts?
-Physiologically, does a potential change in interest rate bother you significantly?
- Wed Sep 28, 2022 6:38 am
- Forum: Personal Finance (Not Investing)
- Topic: Take 50% pay cut for quality-of-life?
- Replies: 88
- Views: 10813
Re: Take 50% pay cut for quality-of-life?
Take 50% pay cut for quality-of-life? 1) Keep plugging away at the current job for a few more years and live with the terrible commute No . Do not take the pay cut. Keep the pay. Retire early. Or, use the earnings for good cause. Your commute isn't terrible. You are riding train. Take a good seat and do something. Read a book, newspaper, or take a nap... I have done all that on NYC subway. +1 I did the train commute, 1.5 hrs (3 round trip) for many years, so I could pull in above avg income (fintech). I slept well on the commuter train. Sometimes read, caught up on emails, listen to music. Not that bad, when the trains are running well. And when not running well, turn around and go home, WFH. Tell them you couldn’t make it that day. +1 5 d...
- Sat Sep 24, 2022 9:46 pm
- Forum: Personal Finance (Not Investing)
- Topic: homebuying anxiety
- Replies: 15
- Views: 1979
Re: homebuying anxiety
Just to be clear, you make >$1m/yr, have only 1 child, and are considering a $4m in part to send them to the public school?
Not meaning to start a school debate, but private school tuition could cost less than the property tax in great school district.
If you like the house you like the house, but school issue seems to be the tail wagging the dog.
Not meaning to start a school debate, but private school tuition could cost less than the property tax in great school district.
If you like the house you like the house, but school issue seems to be the tail wagging the dog.
- Fri Sep 23, 2022 9:44 pm
- Forum: Investing - Theory, News & General
- Topic: At this HIGH LEVEL of interest rate, home prices must come down!
- Replies: 72
- Views: 7562
Re: At this HIGH LEVEL of interest rate, home prices must come down!
On the flip side, renters have experienced significant price hikes and still looking to purchase. Meanwhile, builders are facing a buyer pool unable to pay the same prices and skyrocketing of materials and labor costs. We’re seeing building, i.e. future supply, slowing. Building will take a while to recover and really it hasn’t got back to meet demand from the ‘08 crash. This applies to rentals as well as SFH and condos. I foresee the supply:demand being out of whack for a while.
FWIW, every applicant <30 years I’m hiring is still living at home with parents. I’m paying them $70-80k gross and they still can’t afford to buy and renting is too expensive.
FWIW, every applicant <30 years I’m hiring is still living at home with parents. I’m paying them $70-80k gross and they still can’t afford to buy and renting is too expensive.
- Wed Sep 21, 2022 7:27 am
- Forum: Personal Finance (Not Investing)
- Topic: Future of mortgage rate
- Replies: 37
- Views: 4687
Re: Future of mortgage rate
It will most likely go up, as to how much no one can say. As inflation goes up though, feds hike their rate to slow inflation but also increases the cost of borrowing. The worse was probably in the early 80s when feds had to do a qreat deal of rate hike resulting in mortgage reaching a high of around 18%. Though the rates did drop, it was in double-digit for most of the 80's. I think getting ARM is not a great idea. If the rates go up, it might exceed what you can pay when ARM rate goes up. A 5/1 or 10/1 ARM are excellent products now as they lock in the rate for 5 to 10 years and hopefully you can refinance when rates go down. Not sure the current spread to 30 yr fixed but worth a look if you are in the market to buy. Also, mortgage compa...
- Mon Sep 19, 2022 9:04 pm
- Forum: Personal Consumer Issues
- Topic: Wireless Earbuds
- Replies: 79
- Views: 9140
Re: Wireless Earbuds
Have you tried the “sport” ear buds models? These comes with a hook that goes behind the ears and fix it in place.
Personally, I use the JLab Air sports, which are about $30. These never fall out of my ears unlike much more expensive products like Aid pods. I only to audiobooks and podcasts (not music) for whatever it’s worth. So I can’t comments on the audio quality if that’s important.
Personally, I use the JLab Air sports, which are about $30. These never fall out of my ears unlike much more expensive products like Aid pods. I only to audiobooks and podcasts (not music) for whatever it’s worth. So I can’t comments on the audio quality if that’s important.
- Sat Sep 10, 2022 9:52 am
- Forum: Personal Investments
- Topic: Four percent rule vs SPIA
- Replies: 105
- Views: 11438
Re: Four percent rule vs SPIA
OP, I struggled over these options as well. Here’s my plan and thoughts to address the 4% SWR vs SIPA. The two wild cards are inflation (as discussed) and health (it would suck to realize you’re in heart failure or have cancer the just after you purchased a the SIPA). My FI number is my 4% number plus a pre-SS bridge and a paid off house. Budge is to delayed SS, which is indexed to inflation. My spending will be greater than 4%: it’s 4% plus my bridge money later to be replaced by 4% plus SS. At 80*, I plan to evaluate my health vs likely longevity and need/ability to maintain a house. I may sell the house to fund assisted living if my health is failing or purchase a SIPA if I’m relatively healthy. ——— * on paper, it’s 80. I just use that a...
- Sun Sep 04, 2022 12:43 pm
- Forum: Personal Finance (Not Investing)
- Topic: [How to Quit My Job]
- Replies: 50
- Views: 5524
Re: [How to Quit My Job]
This is my classy protocol for exiting a job: Meet with your manager 1-on-1. "I'm an resigning, effective on date XYZ. Thank you for you everything. We've done a lot of good work together. I've drafted a transition plan. Once you've had a chance to review, I'm happy to have transition meetings with our next leaders to make sure the progress we've made to date continues uninterrupted." Give your manager a 3-column document: Project/Task, Next Lead [Person], 'Read Me document location' [links to set of instructions on a shared location, key contacts for next person, and organized files]. Your manager may have some edits. Prepare a script for the standards questions: -Why are you leaving? -Can offer you anything to stay? -Where are y...
- Sat Aug 27, 2022 9:15 am
- Forum: Personal Investments
- Topic: Best way to save for a house down payment?
- Replies: 5
- Views: 1399
Re: Best way to save for a house down payment?
20% is the rule of thumb because PMI is required for lower down payments.
However, PMI is just another bill like property tax, insurance, utilities, etc. PMI will decrease your monthly cash flow for a period of time, usually 5 years* (though you can shorten that depending on the loan conditions). It may still make sense fiscal sense to purchase a house over renting. I wouldn't get hung up on the idea of having to have 20% down and instead focus on 'buy-vs-rent' calculations.
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*FHA PMI can not be canceled and a very different consideration, but probably FHA won't apply to you.
- Wed Aug 17, 2022 8:28 am
- Forum: Personal Finance (Not Investing)
- Topic: Pay off mortgage
- Replies: 56
- Views: 6840
Re: Pay off mortgage
This is not the question you asked, but you should look into a refi. I just did an Aimloans quote, guessing at some/lack of detail/unknowns, and I was seeing refi around 5% on a 30 year fixed. You could just shorten the duration to 15 years, get a <5% rate, and a get similar effect to what you’re proposing.
Deciding to put extra money into the mortgage is very personal. At 30 years old with an income that’s doubling, I would not pay down the loan with current money. I prize liquidity while other reasonable people prize lower market volatility and certainty and the feeling of being debt free. This is why you see such a diversity of approaches and robust debates on this topic.
Deciding to put extra money into the mortgage is very personal. At 30 years old with an income that’s doubling, I would not pay down the loan with current money. I prize liquidity while other reasonable people prize lower market volatility and certainty and the feeling of being debt free. This is why you see such a diversity of approaches and robust debates on this topic.
- Wed Aug 10, 2022 8:19 am
- Forum: Investing - Theory, News & General
- Topic: Modeling a Variable Interest Rate investment (in an NQDC plan)
- Replies: 2
- Views: 231
Re: Modeling a Variable Interest Rate investment (in an NQDC plan)
(b) the employer could get acquired and the acquirer could decide to terminate the plan, in which case the account values are paid out immediately rather than during retirement (engendering adverse tax consequences). I am under the impression this risk heightened when there is a “change of control contingency” in the plan and the risk is significantly diminished when there is not this feature. I’m also under the impression it’s usually to eliminate debt and clean up the balance sheet ahead of a merger/acquisition. I am not a tax specialist, but I did pay a tax attorney to review my plan before accepting my current job and this was a main topic of the review. My plan does not have a “change of control contingency.” Anyways, my strategy is t...